VOL. 124 | NO. 107 | Wednesday, June 3, 2009
Stanford Attorneys Bail On Humbled Financier
By Andy Meek
Several attorneys working for the billionaire namesake of Stanford Financial Group have filed notice with a Texas court of their intent to withdraw from the case.
Meanwhile, Stanford’s former chairman, R. Allen Stanford, has another opponent chomping at the bit to enter the latest legal fray against him: his estranged wife, Susan.
Those are among the newest developments in a case that turned what once was a high-flying
financial services powerhouse that had a brokerage office in Memphis into a corporate name synonymous with scandal. The U.S. Securities and Exchange Commission earlier this year accused Stanford’s business network of being at the center of an $8 billion fraud.
Along with Stanford, two Memphis-based executives who worked for him have been fingered by the SEC. James Davis, the company’s chief financial officer, and Laura Pendergest-Holt, Stanford’s chief investment officer, were named as participants in the alleged scheme.
When the SEC dismantled Stanford’s business empire, it also shut down the company’s former office in the East Memphis Crescent Center that employed about 50 people.
Several attorneys representing Stanford, a flamboyant Texan with a towering physique and penchant for the game of cricket, moved to withdraw their representation Monday. No reasons were given.
Among those withdrawing are Texas criminal defense attorney Dick DeGuerin and his firm DeGuerin & Dickson LLP. DeGuerin, who favors a cowboy hat, custom-made boots and a trial strategy of “Embrace the ugly, baby,” intends to “continue to represent Mr. Stanford regarding criminal matters.”
Stanford doesn’t face criminal charges yet but expects to be indicted soon. So far, the only charges are civil.
In a Bloomberg News profile of him, DeGuerin blasted SEC representatives involved in the Stanford case as “storm troopers” and described his involvement in the case as “something no lawyer in his right mind would take on.”
Clients he’s represented include David Koresh, the cult leader with whom DeGuerin tried to personally negotiate a surrender before the 1993 standoff in Waco, Texas. That confrontation ended with the deaths of 70 people after the building where several cult members were surrounded caught fire.
DeGuerin keeps a unique memento from a colleague in his law office, according to Bloomberg. After one of his cases was heard in court, a friend gave him a bull scrotum.
The imminent shuffling of attorneys comes at the same time Stanford’s estranged wife has asked to be allowed to intervene in the Texas court where the massive case against Stanford is unfolding.
Susan Stanford filed for divorce in November 2007, and that action remains pending. A receivership order filed after the Stanford case was unveiled seized personal assets of Stanford’s chairman and appears to have interrupted his wife’s bid to stake a claim to some of the assets in the divorce.
“No one has suggested, and indeed cannot, that Susan Stanford had any knowledge of any wrongdoing, much less participated therein,” reads her motion to intervene filed Wednesday.
Susan Stanford told the court she has been trying for more than a year to get a complete picture of Stanford’s estate.
“Susan Stanford has a right to protect her property and get on with her life,” her motion reads. “The Stanfords’ divorce is yet to be finalized, and, in fact, may not be finalized by virtue of the receivership order issued by this court.
“As a result of the temporary restraining order and preliminary injunction, Susan Stanford’s rights … are and continue to be adversely affected. Disposition of any of the Stanfords’ assets without first allowing Susan Stanford an opportunity to be heard would certainly violate her due process rights.”